AR Tiers Up
Vision Monday
Published August 2007
NEW YORK–“I can’t keep them clean.” “They scratch easily.” “They’re too expensive.”
Sound familiar? When it comes to consumer complaints about anti-reflective lenses, we’ve heard them all before.
But these long-standing objections are fading fast as eyeglass wearers are discovering the newest generation of AR lenses. Offering improved AR performance, easy cleaning and better durability, these lenses–unlike previous generations of product–actually live up to manufacturers’ claims.
“For the most part, the old baggage associated with AR–that it didn’t perform well–is about gone,” said Steve Koufos, vice president of marketing and strategic planning for Hoya Vision Care, North America. “A major hurdle has been overcome.”
Major lens manufacturers such as Hoya, Essilor, Zeiss and Signet Armorlite have recently introduced upgraded AR products. These lenses typically offer excellent light transmission, are highly resistant to water, oil and dust and have stronger hard coats. Although such features are typically offered in premium-priced products, many value-priced AR products now boast some of these enhancements.
“There are not too many bad ARs anymore,” noted Larry Clarke, president of AR equipment supplier Satisloh North America. “Five years ago, there was a bigger discrepancy between the best and the worst AR. The worst moved up to be decent. Even the more economically-priced AR brands now are probably as good as the premium brands were five years-ago.”
Such across-the-board quality improvements are boosting confidence in AR among doctors and dispensers, who are more inclined to recommend the newer products to patients.
“Five years ago, I didn’t wear AR,” said Kathy DeCarlo, an optician at Family Vision Care in Lagrange, Ill.”I tried it, but found myself cleaning it 50 times a day. But then I turned 40 and started having issues with night driving. So I tried AR again, and was impressed with the newer technology. Now they are easy to clean, scratch-resistant and still do what they are supposed to do: let more light in and prevent reflected glare.”
For wholesale labs with in-house coating capabilities, the quality improvements have substantially reduced the number of lens returns.
“We’ve finally got an AR product that doesn?t come back,” said Gordon ‘Scotty’ Scott, Jr., vice president of Robertson Optical Laboratories in Columbia, S.C.”That’s a huge change. Does it cost more money? Sure. But consumers are seeing better with less reflections and their lenses are staying clean.”
The new ARs are not only winning back previously dissatisfied customers, but are attracting new wearers, such as children, who had previously been considered unlikely candidates for the product.
AR’s broadening popularity is driving sales to new highs. AR lenses accounted for 21.8 percent of all lens sales in the U.S. for the 12 months ending March, 2007, up from 18.8 percent for the 12 months ending March, 2003, according to VisionWatch, a survey of over 100,000 U.S. consumers conducted by Jobson Medical Information and the Vision Council of America (VCA).
As AR moves slowly but steadily from the industry’s margins into its mainstream, new pricing structures are emerging that reflect different levels of product quality. At the low end of the AR market are products such as Wal-Mart’s Anti-Glare, a coating that retails for about $30 on a single-vision plastic lens. At the upper end are products such as Essilor’s Crizal Alize with Clear Guard, Hoya’s SuperHiVision and Zeiss’s Teflon Clear Coat and Signet Armorlite’s Kodak Clear, which often retail for $90 and up.
The AR market has now coalesced around a three-tiered, “good-better-best” pricing structure. “Good” products, which are value-priced, offering basic AR performance features, typically increase the retail price of a lens by about $30 to $50. “Better” products, which some refer to as “premium,” are easier to clean and add about $50 to $90 to the retail lens price. “Best” or “super-premium” products, which typically combine easy-to-clean features with enhanced scratch-resistance, sell from about $90 to $110 above the retail lens price.
Although mass merchants, notably Wal-Mart, are scoring success with lower-end product, many lens manufacturers, optical retail chains, wholesalers and independent eyecare practitioners report that the mid- and high-priced segments are growing fastest and offer the greatest revenue potential. However, most are marketing multiple tiers of AR products in order to attract the broadest range of customers.
“We have an offering that fits a good-better-best model,” said C.J. Hartmann, Teflon brand manager, Carl Zeiss Vision. “The good level, which is our Zeiss SuperET, provides high-quality anti-reflectance and resistance to dirt and water. It goes out with a very economical price. We’ve seen modest growth at that level.
“The better level, which is Zeiss Carat, provides a little better scratch resistance, is easier to clean and has hydrophobic properties. Sales at that level have been very flat.
“The highest growth is coming from best level, the premium level, which consists of Zeiss Carat Advantage and Teflon Clear Coat lenses. Those products are the easiest to clean and most durable. The high growth is coming from the fact that physicians believe it’s a high-quality product that accomplishes the goal of providing the best vision. All the benefits it provides to the patient are seen as important if not critical, and are brought up as part of the consultation. The consumer, especially with Teflon, sees the value and the benefit, and takes the recommendation from the physician,” Hartmann said.
In an effort to expand the market for Teflon Clear Coat, Zeiss recently launched a promotion with Transitions lenses called, The Search for Vision Island. “We’ve been getting good response so far,” said Hartmann. “We’re also going to continue our comprehensive direct mail program. A lot of physicians are telling us they have people bringing direct mail pieces into their offices requesting Teflon on their lenses.”
Hoya Vision Care offers an even more diverse AR product mix. The company currently fields four different products, ranging in quality from its top-of-the-line SuperHiVision to HiVision with View Protect, High Vision and Hoya Premium AR. ”
Our premium brand growth has been huge,” said Hoya’s Koufos. That’s what’s driving our AR growth. As we add more capacity in the SuperHiVision and HiVision area, our growth is almost hockey stick-like. We almost can?t bring on AR capacity fast enough.”
Koufos said Hoya differentiates its AR products based on “superior scratch resistance and substrate matching,” a process that involves matching the index of refraction of the various coating layers with that of the lens material. The company also takes a slightly different approach with marketing Viewprotect, its hydrophobic-oliophobic treatment. Although ViewProtect comes standard with SuperHiVision, Hoya offers it as an option with HiVision and Hoya Premium AR.
“We decided it would be an interesting feature to add to our existing AR portfolio,” said Koufos. “We’ve found it’s better if we offer it as a contiguous brand, as in HiVision with ViewProtect. When we add it as an a la carte option it’s difficult for people to remember.”
Independent coating laboratories are also offering multiple tiers of AR products. Although most of these products offer a combination of easy cleaning and durability, labs design certain products to emphasize a particular feature. For example, Topit, the newest release from iCoat, a lab in Santa Fe Springs, Calif., features an ultraslick, super oleophoibic topcoat for easy cleaning. The topcoat, which can be applied to any lens style or substrate, is so slippery it can only be applied to edged lenses. For customers with uncut lenses, iCoat offers Vivix, an AR coating with a superior hardcoat.
Illusion HP, a new AR from Opticote in Franklin Park, Ill., features a hydrophobic topcoat with a greater contact angle and superior durability to extend the life and mechanical performance of the AR and increase lens cleanability. After the topcoat is applied, a very thin “roughener” is applied to make the lens less slippery to assist in blocking for edging and frame insertion. The roughener washes off easily, and after wiping the lenses a dozen times, the maximum contact angle is restored, according to Opticote. For customers seeking maximum durability, Opticote offers tzAvoRite, which boasts an extremely hard coating.
Essilor of America has created a three-tiered pricing structure for its flagship Crizal brand which consists of Crizal (good), Crizal Alize (better) and Crizal Alize with Clear Guard (best). Recently, the company has launched value-priced two AR brands: Sharpview, which is marketed by Essilor Laboratories of America, and its latest release, House AREZ, which is sold through Essilor?s independent distributor lab network. Both lenses offer good performance characteristics. For example, House AREZ delivers 97 percent light transmission, a super-hydrophobic layer with 110-degree contact angle and Essilor’s exclusive Pad Control System that reduces breakage by four percent, according to Essilor.
Essilor executives believe Sharpview and House AREZ will help ECPs overcome customers’ objections to price and performance.
“We know that with the Crizal brand, the market likes to have the best technology available,” says Marc Mialon, AR brand manager for Essilor of America. “Another thing is you have some price-conscious practices and consumers who want the performance and quality benefits of AR without paying the premium price. But they’re concerned they have if they pay a lower price it may not very good quality AR. They haven’t wanted to spend the money, so the doctor isn’t even introducing AR. By introducing a good quality AR at a lower price, we’re addressing those value-driven customers and ECPs.”
Mialon believes that positioning Sharpview and House AREZ as entry-level products will grow the AR category in the long term.
“We want patients to first be happy with their AR,” he explained. “Then, the next time they go to the practice, they’ll buy premium because it offers better benefits. They’ll be more willing to trade up, because the price difference will not be that much.”
However, wholesalers may take some convincing before they are ready to embrace lower-priced AR.
“There is definitely a debate going on right now,” said John Anderson, vice president, general manager, Ophthalmic Division, Walman Optical, the nation’s largest independent wholesale lab operator and a major Essilor distributor. [Essilor’s] conclusion is probably a little early. Our experience last year bears that out. Our higher-priced AR products are all growing at a high single-digit or double-digit rate.
“Crizal Alize is our number one AR, but we’ve had a greater increase in units with Crizal Alize with Clear Guard,” Anderson said. “The coatings, which are dropping in numbers, are the standard Crizal, Zeiss Super ET and Zeiss Carat.”
Anderson said sales of Walman’s house brand AR, Ultra, have also been increasing significantly. Although its mid-price point may account for some of its popularity, Anderson said Ultra’s versatility is its real appeal.
“The biggest problem the doctors and their staff have with coatings like Crizal Alize with ClearGuard is they can’t put it on any lens they want to,” he observed. “If they have an option that can go on anything, they like it better.”
Anderson believes AR lens performance matters more than brand or price to most of Walman’s customers and their patients. “There isn’t the brand loyalty with AR as there is with progressive lenses,” he noted. “But people are willing to pay the price if the product performs.”
Gordon “Scotty” Scott of Robertson Optical Laboratories believes the power of a brand name such as Teflon does make a difference when marketing AR lenses. Robertson recently installed an in-house AR coating lab and is producing Teflon Clear Coat lenses from Zeiss.
“The Teflon name recognition is huge to the public,” said Scott. “Zeiss is also doing straight-to-consumer advertising using mailers and newspapers. They’re letting people know if a practice is Teflon-certified.”
Robertson Optical markets a three-tier AR product line consisting of Zeiss Carat Foundation and Teflon at the high end, Zeiss Carat in the middle, and Zeiss ET as the standard-grade AR. “Our AR sales are about 60 percent high-end, 35 percent middle and 15 percent low end,” Scott reported.
Interstate Optical, a major independent wholesale lab located in Mansfield, Ohio, also encourages customers to buy its best quality AR, Crizal Alize with Clear Guard. However, he said most customers prefer Interstate’s better level, which consists of Crizal Alize and Interstate’s house brand, ARx.
“When you go to a good-better-best offering, people almost always pick better,” he said. “They think the best is overpriced, there?s not enough value, even if money is no object. And they tend to think good is not very good. We have lower-priced product, but nobody seems to want it.”
At the retail level, many independent ECPs and chains typically narrow their AR product selection to just two AR options, or in some cases, just one.
“We offer just one AR: Crizal Alize,” said Fenton Allen, R.D.O., general manager of Optical Illusions, which operates upscale stores in San Mateo and San Jose, Calif. “It’s the best. It comes with a one-year guarantee against scratch or peeling.”
Allen said Optical Illusions has been selling Crizal Alize for the last nine months. Prior to that, the stores had been selling Alize and Vivix, an AR product made by iCoat.
“When we switched to Crizal Alize, we raised our prices from $79 to $109. But sales have not dropped.
“We have an affluent clientele, and we highly recommend premium AR,” he added. “Ninety-nine percent of the people that have worn it expect it again.”
Selling AR lenses is big business for Luxottica Retail, which operates the LensCrafters and Pearle Vision chains as well as optical departments in Sears and Target stores. Although the company won’t reveal its AR lens sales, AR “continues to trend positively,” according to Dave Plogmann, senior vice president, lens products, Luxottica Retail. “Our penetration outstrips average category growth. That’s been a continuation of a trend over the past several years,” Plogmann noted.
Luxottica markets different AR brands for each of its retail chains.
“We are very focused on insuring we have a unique brand proposition, so that what we bring to light delivers on the expectation of that brand,” said Plogmann. “We’re very focused on not having a ‘one size fits all’ approach.”
LensCrafters offers two AR brands. FeatherWates Complete Made with Scotchgard Protector, is a premium-priced polycarbonate lens with superhydrophobic properties. Superview 1.67 (AR) Lenses Made with Scotchgard Protector is a standard AR product that LensCrafters recommends for drill-mount frames.
“The most profound difference between the two products is thecleanability aspect,” Plogmann noted.
Pearle Vision offers standard “Non-Glare Lenses,” which it describes as “crystal-clear lenses [with] a non-glare treatment that allows more light through the lens.”
Plogmann says Luxottica is seeing growth with both its premium and standard AR products. “But it’s safe to say premium AR advances in technology are creating the excitement in the category today. Cleanability is one of the things that is creating excitement.”
Plogmann compares AR’s upward trajectory to that of progressive lenses.
“Think of someone who tried progressives 15 years ago and has been wearing a flat top ever since. They’ll be blown away by the differences. The same is true for photochromics. There have been advances, and people have had to overcome bad experiences with earlier products.”
Plogmann is optimistic about ARs potential to become a mainstream consumer product.
“We believe very strongly that AR is product for everybody. That includes kids as well. The old belief was AR is great, but it’s not good for kids. They’re too hard on glasses, and the AR would peel. That’s changing. We’re creating a belief that AR is a product everyone can benefit from. And the best AR is the product people are going to derive the greatest benefit from.”
Yet Plogmann acknowledges it will take time and resources to educate consumers about AR and properly position the product for maximum acceptance.
“The challenge we are dealing with in the market is the complexity of product,” he said. “We’ve got to find ways to simplify and streamline the message to the consumer. We’ve got to figure out what is the right number of options. We’ve been guilty as an industry of not editing down the choices. And that’s a challenge for the category, because new products keep coming out. We don’t want to be just piling a bunch of choices on top of what’s out there today. We need to be very deliberate, so the consumer feels like their needs are being met and understood.”
– By Andrew Karp